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This Week With Christiane Amanpour

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  ABC    This Week With Christiane Amanpour    News/Business. Political  
   guests and viewpoints. New. (CC)  

    July 31, 2011
    9:00 - 10:00am EDT  

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this week, the endgame. >> our country is notoing to default for the first time in history. that is not going to happen. >> now, at the 11th hour, perhaps some cause for optimism. >> there are negotiations going on at the white house now. on a solution that will avert a catastrophic default. >> with the whole world watching the president faces his toughest challenge yet. abc's chief political correspondent george stephanopoulos joins us for the inside story and the very latest as the crisis nears a climaclim. the top political viewer joins
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us. and key crossroads. republican senator lindsey graham on the search for consensus within his own party. also, from norway to ft. hood. extremism is back in the headlines. new york city police commissioner ray kelly on the very real threat posed the radicals. and we'll take you to mowimogad somalia, where we report on the country's epic familiar in. >> announcer: live from the newseum in washington, "this week with christiane amanpour" starts right now. welcome to the program. lots to get to today, but first, some news since your morning papers. we have new develops to report on the story dominate all others and that's the flurry of last-minute talks to raise the debt ceiling before the country runs out of money to pay its bills. and this morning, we're hearing there is a framework of a deal being worked on, but it's
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fragile. and you can see the clock ticking down to the tuesday deadline. already, we're seeing signs of mounting concern on wall street. the stock market plunged more than 500 points in the last week. a loss of $700 billion, or just over 4% of its value. but this morning, a glimmer of hope, perhaps, for the very latest i'm joined by abc chief political correspondent george stephanopoulos. george, you've been talking to all of our sources. are we at the edge or pulling back from the edge? >> anywhere where there is beginnings of an end game is back. this is a framework, as you said, not a final deal at all. but designed to get each side the bottom line. the president gets the debt ceiling through the election, 4.3 $2 trillion. the republicans get the debt reduction spending cut that meets that $2.4 trillion. here's how it would work. a trillion dollars in spending cuts right now. then a special congressional committee set up designed to
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report about thanksgiving to come up with another trillion or so dollars in spending cuts, maybe a little more than that. the run is on. what happens if this congressional committee doesn't get that $1.4 trillion in deficit reduction. they are working on what they call a trigger that guarantees spending cuts in defense and domestic programs if this congressional committee doesn't meet the goal. now, the question would be, does that trigger also include revenue? congressional sources saying no, does it guarantee automatic spending cuts? congressional sources saying yes. the white house saying they don't a aee with that yet. that's why we have david plouffe the senior adviser to clear that up. >> indeed. joining us, david plouffe, the senior adviser to president obama. you've heard all we've been talking about. is there a deal? >> no, there's not. >> is there a deal close, a framework? what can you tell us? >> well, i unfortunately can't negotiate here on your prograra
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i think what is clear is pretty much both parties agree that there's going to be a first stage of deficit reduction over a trillion dollars. that there's a process, as george talked about, a congressionanacommittee. what that work on, the items the president is focusing on with speaker boehner, you won't reduce the deficit without title reform. >> that reduces debt increases -- >> any lolo-term deficit reduction. i think the american people have spoken clearly about this too if you're a middle class family, a senior citizen, you're furious that the answer by some in washington, is to ask you to do everything. you have to have closing of tax loopholes, and revenue to close the deficit. there is, without getting into details, one of the things we're focused on. this is what he outlined in the spring, an ens forcement mechanism. i think it's incumbent to appoint people to this committee
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focused on debt reduction, willing to get out of their party's comfort zone. but enforcement mechanism. so the committee doesn't act, if it deadlocks, let there be additional deficit reduction. that's obviously one of the areas that's under discussion. >> do you nowthy as this is being worked on. do you think after all this tension and stress between the parties, that there will be something that both parties can get all their members, the majority to vote on? >> we he still have hard work to do. but it would be inconceivable that we don't. the american people, you flashed the stock market decline this week. it's clear it's hurting consumer confidence, business confidence. we have to remove this. the debt ceiling has been raised a couple of times over the last couple deck aids. it has to be raised again. remember what we're talking about. these are bills congress put on the credit card. they are required to pay for them. we agree, if you're an american citizen, you should be pleased by this. there's this unanimity we need
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to stop putting as much spending on the credit card. the debate we're having is how do we reduce the deficit. i think all of the leader had said privately and publicly that the united states of america will not default. >> will it happen by the deadline, august 2nd deadline? >> that's the deadline. our borrowing authority runs out. >> no short-term extensions? >> what we said and some on n congress said, if you have a deal and needed a day or two to dot the is and cross the ts there's no reason to do that. we have to get this done by tuesday. it's inconceivable for the united states of america, the impact that we have not only on people here in this country, most importantly, but around the world would be catastrophic. >> let me press you on the details. the details of this mechanism are all important. this is what the whole negotiation is coming down to. the president said time and time again, he wants a balanced approach that includes tax reform revenue increases. everyone i talked to on capitol hill said this enforcement mechanism would not include
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revenue increases, would be just across the board spending cuts. domestic spending, medicare, perhaps and defense and would not include revenues. so if the enforcement rec nice many doesn't incncde revenue, what incentive would republicans have to consider revenue increases and wouldn't it all but guarantee the final product is all spending cuts and not the balanced approach the president wants? >> i will. first of all, i think the committee is going to be charged with finding significant deficit reduction. i think there's a lot of focus on that committee, certainly the work he did on that committee. i think the american people spoke they wanted a balanced approach that want something of everybody. whatever enforcement mechanism put in place, has to be strong enough to compel action. whatever its composition, people shouldn't look at this enforcement mechanism. at least from my viewpoint, you should assume that's going to happen, because what you want, historically there's been enforcement mechanisms strong enough to compel action.
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back in 1990, the first president bush, there was a looming trigger that people wantededo make sure didn't get revenue increases, now you're talking about one that does not include revenue increases? isn't that the problem? >> we're talking about a variety of options here. the key principle is that the enforcement mechanism has to be strong enough to compel both parties. >> can the president accept an enforcement mechanism that's spending cuts only that does not include revenues? >> what i would say, we would accept an enforcement mechanism that compels both parties to action and also is something that we think substantively is acceptable to your country. >> you're saying there may be a way to compel action without including revenues? >> again, we're talking about a variety of different options here in the closing hours here about how to compel that action. i would say the positive thing is, i think both parties agree, that you need such an action. and exactly what the composition is.
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again, we want to make sure there's focus on this committee acting. i think this has been a healthy debate. the american people understand a lot more about the deficit, about there's no easy answers, it's been a healthy debate here in washington. and i think any long-term deficit reduction will include revenues, and smart entitlement reform. republicans don't agree with that. >> well, some republicans do. first of all, i would say most republicans in america do, and you begin to see a republican senator speak to this, that, listen, we had a deal with speaker boehner that obviously fell apart that included $800 billion in revenue. i'm confident any solution that this committee would produce that ultimately is voted o oin congress is a balance. >> frustrated members of your own party, they are saying, look, why doesn't the president who has his principle stand up for him, rather than spending so much time wanting to beebe partisan and conciliator. they are saying the republicans are driving a harder bargain. as george described, the
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president proved all of the way to the language and the ideals that the republicans espoused. >> if you look at -- yes, because he wanted a clean bill, then a bill with cuts on spending and as george is talking about, it's all cuts for the moment. >> first of all, we've been clear, we need this debt ceiling increased into the future. the spectacle in washington, this week, anyone who thinks we shouou repeat this a few months down the road. i don't think there's enough people in america. our economy cannot have this cloud over it. certainly deficit reduction will happen in two stages. there's a first stage that has cuts agreed to. largely that came out of the work the president and vice president did. acceptable to largely members of both parties. the second stage is a committee looking intotohe tougher issues of entitlement reform and tax reform. the president believes we need to reduce the deficit. this isn't playing on a republican playing field. this country, has to live within
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our means. if you're oppressive. there's a powerful place for them. college loan, spending of roads and bridges that put construction workers to work. if we don't reduce the deficit we won't have room to do any of that. we have to live within our means. the president is clear he's willing to do tough things. only way to do that is get out of your comfort design. you won't do it without smart entitlement reform. >> does that include medicare cuts? is medicare cuts back on the table as part of enforcement mechanisms mandate? >> again, there's various enforcement mechanisms that have different consequences. in the initial spending cuts these are domestic spending cuts, both defense and nondefense. the committee's charge then, before we get the enforcement mechanism. how do you fill in the rest of the details. the truth we cut a lot of
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domestic spending. >> drives you to medicare and medicaca and social security. >> and tax reform. the president is clear, he laid out -- he was willing to do medicare reform. if we can strengthen medicare, social security as opposed to what the house republicans wanted to do which is largely dismantle it. >> we keep talking about tax reform which is seen all week long. there are not votes in the house of representatives for the kind of package you're talking about. >> it's hard to get a majority of house republicans to even support their own plan. here's what i'm convinced. the shame is, if the quote, unquote, grand bargain the president is working with the speaker on. i'm convinced, had that come it would have been the easiest to get the votes for. it's deaf kit reduction on a grand scale. even though there's component parts, people would be willing to accept it. we'll do it in two stagege ultimately we need the same outcome. significant deficit reduction, $3 trillion, $4 trillion over
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ten years, really reduced the deficit year after that and done in a balanced way. >> you keep saying, it has to be done. if it's not. what are the u.s. soldiers fighting for this country in afghanistan, asking their commander whether they get paid is really shameful. >> yes. >> what are the choices that are going to be made if this doesn't come through as you hope? >> well, it's really unthinkable. i think the specter you raised is one of the reasons i think there's so much urgency on capitol hill this morning. >> what are the tough choices and what will be paid? >> first of all, our focus now is on solving this. you know, we don't have much time left. a little over 60 hours, i guess. we've got to get this solved. >> and, you know, at the last hours, people are looking for off ramps. there is no off ramp here. the only option for congress to raise the debt ceiling and sign the initial deficit reduction savings into law. obviously, if congress isn't
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able to act, the treasury department has to brief people affected and will obviously do that. the focus has to be driving toward some conclusion. i think the american people are sitting home sasang, they've gone through this recession, many lost jobs, many working two job, helping family members affected. they are furious at this. what they are screaming -- the president a couple times talked about compromise. capitol hill is be sieged by tweets, by call, by e-mails. the american people are fed up. they want their leaders to lead and part of leading is compromise. you worked on capitol hill, george, any meaningful agreement has to be based on compromise, particularly when you have divided government. the american people chose dividedegovernment in 2010 but they did not choose dysfunctional government. i think the spectacle this week enraged americans and hope to solve this problem over the next two and a half days. >> david plouffe, thank you very much indeed. again, capitol hill becomes
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a hive of activity this afternoon when senator majority leader henry reid brings his troops in session. we'll begin to see how the rank and d le responds to negotiations. we're now joined by lindsey graham of south carolina. thanks for joining us. >> thank you. >> as all of this goeoe on we'r hearing from minority leader, mitch mcconnell. close to presenting something to their members. is this what you're hearing? the kind of thing you get on board on? >> i don't know where i'm going to land but there is a resolve to get this done in a way you don't go in tuesday with a default. there's a lot of history being made here. the average debt ceiling in terms of time since 1940 has been 20 minutes. we'll do 20 months since the proposal. i think we can declare victory in a limited fashion. this is the first time, in my
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lifetime, that i know of, we're paying for future debt increases dollar for dollar. that would not happen since the 2010 election. which is the size and coach the government. you tell tea party folk, quite frankly people like me, we've won. wait a minute. we've changed the culture in terms of raises the debt ceiling but in the next decade, adding additional money to the debt. the government continues to grow. i think what we've been able to achieve is historic in terms of the debt ceiling debate. but we're not -- we're no longer running toward "belieoblivion, walking to it and we have to turn and go the other way. >> everyone speak against speaker boehner's plan. even though it had the balanced budget amendment. >> i don't see many cocoervatives getting behind
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this. i learned in politic, don't oversaenld don't tell people they should feel good when they have a rein not to feel that great. >> will it pass? >> i think half the conference in the republican house must vote for this. to president obama -- >> only half? >> i think that's the minimum. because i like john boehner, maybe he can get more, but it's a $3 trillion package that will allow $7 trillion to be added to the debt over the next decade. so how much celebrating can you do about that? >> in order to get something like this, it close not include revenue increases. >> that is a win. it would only get half? >> my belief is, what do i tell people at home? what did you do about getting us out of debt? i slowed down how much debt you add. instead of adding ten, we'll add seven. i slowed down the growth of government but it still grows every year, for those who came out and voted in 2010, and said get the size of scope of washington and change the new
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direction. >> only half the republican this could go down. >> our democratic friends provided no plans -- >> you said there's no plans, he moved so far, entirely to your side. >> his rhetoric -- the reason everybody moved -- >> the whole spending cut. >> there are people in my party who are not excited to vote -- >> you're not going to vote for this, are you? >> from a big picture, i'm not ready to vote for this. let me tell you why -- excuse me, george, the bottom line here is, the people who got elected are not excited about being republicans or democrats, they are excited about results. and it is fair to say, we've achieved significant change in the way washington works by paying for the debt ceiling increase and not passing it on to the credit card. we've not achieved entitlement change, we've not reduced the size and scope of government. we're going in the wrong
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direction at a slower pace and for a lot of people that is not winning. >> you're an internationalist. we talked about all sorts of things like afghanistan. u saw the soldiers yesterday and i asked david plouffe, desperately asking their commander, admiral mullin, whether they will get paid. and he said i can't tell you. >> i can. i can tell them. here's what i would have said, not only are you going to get paid. admiral mullin said the number one national security issue facing this country is debt. and i wish we would have followed on with what we said. if you believe we're so far in debt, we'll become a weak country and can't afford to defend ourself, i would have told the marines, you are going to get paid by by god change the reason your children don't have the american dream. young man, we'll pay you, but we'll change washington so your country doesn't become weak and ineffective and have more debt than your children can afford to pay. that's what i would have told them. >> you must also worry about the way the world is seeing this
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country right now. i mean -- >> i i not worried about democracy. >> you have people in this country who just won a big election. they weren't kidding when they said they wanted to come to washington to change the size and scope of government. then you have people saying, you don't understand, you don't get it. well, let me tell you, i do understand, 43 crepts on every dollar being borrowed, medicare and social security will fail, so what i would tell anybody around the world. thank god these new people are here, because do you want america to become greece? do you want our d detective instruments not to be well received throughout the country? do you want us holding our debt, never to turn around while in debt the 14.3 trillion? this deal and it is better than a lot of people thought, but not nearly where the problem is. >> senator, on that note, thank you very much indeed for joining us. >> thank you. >> coming up, our "roundtable" on the emerging framework, the
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deal and the big question, can it hold? we'll take off where senator lindsey graham just left off. the stakes couldn't be higher for this country, and the obama presidency, stay with us. r for and not because silverado's the most dependable, longest-lasting full-size truck on the road or because heavy duty made motor trend's 2011 truck of the year. no, it was good because you told us so. consider this a thank-you. the chevy model year wrap up. get in on our greatest model year yet. right now, combine the all-star edition discount with other offers for a total value of $6,000. our greatest model year yet is wrapping up. hi, how are you doing?ne. hi, evelyn. i know it's been a difficult time since your mom passed away. yeah. i miss her a lot, but i'm okay. wow. that was fast. this is the check i've been waiting for. mom had a guaranteed acceptance life insurance policy
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the administration ever put any plan on the table. all t ty would do was criticize, what i put out there. i stuck my neck out a mile to try to get in agreement with the president of the united states. i stuck my neck out a mile. >> house speaker john boehner on friday night. the speaker weathered someough challenge this week. now he faces a new test. whatever deal he works out between the senate and president will have to pass muster in the house. a lot of twists and turn still to come. joining me george will, paul krugman also a columnist for "the new york times." grover norquist, president of the american tax reform. a group that played a major role in this debate and one again, abc chief political correspondent george stephanopoulos. gentlemen, you just heard what
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senator lindsey graham said, what david plouffe, the president's adviser said. mitch mcconnell saying they are quite close, that he'll have the parameters of framework to show to his members today. is this now going to pass? are we going to get a deal? >> i think we are. i think it was signalled when the president spoke last monday. that's six days ago, seems like six months ago. what he said it was unjust, unacceptable to have a debt ceiling agreement that does not include revenues, that is unbalanced. the president said that after the second most prominent and powerful democrat in washington, harry reid proposed exactly that. not only proposed that. but an an crease of revenue, but increase that had the other main republican component, which was spending cuts, commence o comme the debt ceiling. >> it's a win? >> it is a win.
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it's comomred to the sistine chapel ceiling. it's imperfect. >> is this imperfect or enough for you to get your people behind? >> it has the two biggest challenges, everybody going back to 1982 and 1990. it doesn't have a tax increase in it. it appears to have real spending restraint with mechanisms to enforce it, as opposed to what happened in the past where we had the tax increase without spending restraint. by missing those two, it moves in the right direction. would i like to see more spending reductions? absolutely. are we moving in the correct direction? yeah. >> george we've been talking to senator graham and david plouffe. senator graham seemed to say it didn't go far enough and he wouldn't vote for it. >> said it was historic and victory in a sense, but won't be voting for it. take a step back. you go back since the majority was elected. since then, the bush tax cuts
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extended. they got $30 million in the spring, going to $2.4 trillion now without any revenue increases the president has called for. you talk to people in speaker boehner's house, this is a big, big win. i don't know how you can deny itality this point. >> first thing, you shouldn't from the perspective of a ration al person, we shouldn't be talking about spending cuts at all now. we had 9% unemployment. these spending cuts are going to worsen unemployment. it's even going to hold the long-run fiscal picture. we have a situation where more and more people are becoming long-term unpleaded. if you have a situation that permanently raises the unemployment rate. that raises future revenues. this even hurts the long run fiscal situation. then on top of that. budget cuts that are entirely -- basically the p they well blow up the world economy unless you
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give us what you want and the president says, okay. that's what happens. >> you've been consistent when there's a time of recession and weak recovery. what is your scenario once this goes through and there's significant spending cuts and no revenues. >> we're looking. we used to talk about the japanese and lost decade. we'll look at them as a role model. they did better than we're doing. i have nobody i know who thinks the unemployment rate will be below 8%ality the end of n nt year. with the spending cuts it might be above 9%. there's no night at the end of this tunnel. we'll having a debate in washington, all about, gee, we'll make the economy worse, but will we make it worse 90% republicans terms or 100% republicans terms? the answer is 100%. >> paul's right. we're a third of the way of the lolo decade. after t.a.r.p. cash for clunkers, dollars for
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dishwashers, entire rain of stimulus which simply hasn't worked. >> in advance. one important point to make is there are people like me said in advance this wasn't remotely big enough. it's not an after the fact. it's not coming back afterwards. i looked at the numbers, people like me look at the numbers, we'll have huge cutbacks at state and local level. a federal increase barely enough to limit those cutbacks. there will be no net fiscal stimulus, look at government as the whole which is what happens. here we are. >> good to go to the electorate and saying resolved, the government is too frugal. >> president obama has been deeply involved over the last, you know, several days. last 48 hours for sure. but it's been a very rough week, george. how will this pan out? >> first of all, the president needed the deal. he bears the consequences of default more than anyone else. even if the public blames the republicans more for what
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happened. he has to deal with what happened in the economy. i think at this point, the white house is hoping by getting a deal, he can start to right the ship. you look at what's happening with the polling of the president's approval rating. the gallup poll has them to 40%. before we came on air. had them barely beating the public, 41-40. he took a real toll on the president's position. >> we've also had 50 states that sort of played this out as well. in the last couple of years, they've not raised taxes, places like new jersey, wisconsin, major states, texas, florida, what they've done is reined in spending. the states that reduced spending and not raised taxes are doing better than the states like illinois, and connecticut which are trying to raise taxes. >> no, it's not. we can get into statistics but it's just not true. let me say on the politics, look
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at polling, turns out the average republican voter thinks there's some revenue as part of this deal. the president has agreed not to just an agreement wayo the right of the average american voter. it's actually to the right of the average republican voter wants. >> he's fought here, heimply doesn't have the vote. >> he has options. there are -- i'm aware of at least four possible legal routes -- >> 14th amendment, article 1, platinum coin. people know about the platinum coin issue. >> a trillion dollars each. >> which is ridiculous. the whole debate is ridiculous, right? you have somebody holding the american economy hostage. they could never actually pass through congress and never get past the voters, you go for whatever you can do to stop it. have done something is go back d in december when republicans are calling for an extension of bush he could have caused for extension of the debt limit.
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it might not have worked but when he has the most leverage. >> there's nothing legally, constitutionally, any way that binds the debt ceiling to the budget. why didn't he take a stronger stance in saying, these are two spratt issues? >> it's what we ask on everything, right? why have the president unwilling -- you know -- >> george, he could have done it, right? >> he always signals -- >> he begins every negotiation by signaling, i'm willing to move halfway. he moves halfway. he's never -- >> he paid attention to the 2010 election. he noticed what happened. i don't think the president -- we know the president wasn't willing to stand up and say, i don't care about overspending, i just want to let you borrow more money. i don't care about overspending. he can't say that three times outloud and have a prayer in 2012. if you look at the democrat seats up half in reddish states and ten republican senate seats in reasonably republican states with the possible exception of
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massachusetts and he has $10 million in the bank and looks great in a bathing suit. how will he hold on to the white house if he says he doesn't care about spending. >> the 2010 elections were on two themes. jobs and democrats will cut medicare. let's give the republicans cover. >> look, there are 50 house republicans saying, we're willing to send the country into default. he doesn't have the leverage. >> if he just says no. >> jobs and further leverage right after the break where we'll have more with the "roundtable." first, how will tomorrow's markrk respond to today's news? we get an expert reality check. stay with us. >> announcer: "this week with krin yawn amanpour from the newseum in washington, d.c. will continue after this from our abc stations." óç
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this week, wall street started to waiver withh the deadline moving closer. the ripple effect stretched to overseas, international markets shaken by the climate of deep uncertainty and confusion, so what will tomorrow ming? mohammed el erian joins meme th
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ceo of pimco, the large east largest bond fund. thank you for jeaning me. you heard mitch mcconnell is quite optimistic. there's a framework of a deal. how do you expect the markets to react come open time today and also tomorrow here? >> two way, christiane, first, i think this compromise will lead to an increase in the debt ceiling, and therefore avoid default. but this relief will be short. and with will be short because markets look at the discussion not as an end in itself, but a means to an end. when they look at a means to an end, it will not remove the threat of a downgrade. it does nothing to restore household and corporate confidence. so unemployment will be high, than would have been otherwise, growth will be lower than otherwise, and inequality will be worse than otherwise, and, thirdly, like you said, the rest of the world is watching, and this will do very little to
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reduce the concern that the rest of the world has, about the role of the u.s. and global economy. so i expect the relief to be short-dated. >> let me ask you about the downgrade. there's obviously quite a lot of debate about not only will it happen but if it happens, how dramatically bad would that be from the united states? what, from your perspective would be an effect of a down grade from aaa? >> we have constructed both a global system and national system based on u.s. being a aaa. if the usa loses aaa status, it will be much more difficult for the u.s. to restore growth. it's bad. >> how likely do you think it is to happen, the down grade? >> we have one waiting agency out there that said, it would down grade, unless certain things happen. and these things are not happening fast enough. so, if this rating agency, s&p, sticks to what it said, it will down grade. of course it's under tremendous
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pressure not to do so, but it said it would downgrade. >> and in terms of u.s. economic growth, this first half has been very weak, the first quarter, even down graded, if you like, from the estimate. what will substantial spending cuts do. will it materially improve the outlook for u.s. economic growth? >> no, here i'm with paul.. because we have a very weak economy. so with growing more spending at this stage, will make it even weaker, especially that this is not actionaged in the context of medium term viability. remember, christiane, public finance is only one of the head winds in thihieconomy. we have a bankingystem not operating properly, we have a labor market not operating properly and a housing market not operating properly. >> all right. thank you so much indeed, mohammed el erian. sober rg words as you heard. let's bring you all back for the
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"roundtable" discussion. the big overarching them is to get the economy back on track and improve this really drastically weak recovery. paul, how is that going to happen? >> my first best guess, my maximum likely estimate, is it won't happen. not for years and years to come. no one is discussing the kinds of policy that might make it happen. we're waiting for the economy to heal itself, which it's doing very slowly. >> a a there things that can be done to make people go back to work? infrastructure?tural >> look, if we -- there are potholes everywhere. if we actually -- you know, if willingness to just do, sort of obviously needed infrastructure work, with borrowed money, that would do a lot. we'll not do that. other than that, ben bernanke might be able to pull a few more contributes out of his hat. but it's really hard to see where this will come from. >> george, if that happen, and there are all these dramatic
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turns and the economy doesn't improve, what does that do politically? will people blame the president come 2012 and going to blame the republicans? what's going to happen? >> i think they'll blame the president. it takes 2.5% growth annually to create enough jobs to account for the natural growth of the labor force. and the numbers we got this week -- the first quarter growth of 1.9% was revised down to 0 .4, then 1.3%. >> list ton mohammed el erian. he is not alone. on the one hand, he said if you don't have the tremendous spending cuts, we'll get down graded by the rating agencies, that's going to be a disaster. >> who are these guys and why do they have this power? they've been wrong about
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everything. they downgraded japan in 2002 and the result, after 19 years you would have made a lot of money. >> i agree with that. but mohamed el erian said if you make the spending cuts the economy will be stuck in the mud. it's a paradox you can't break. >> not par paradox. >> the answer is spend now, work on it lalar. >> the problem is not in the next decade, but what happens in 2020. if you can promise to do reasonable things after 2020, while at the same time actually spending, it will never happen -- it's politics, there's no economic industry. >> there's short-term progress and long-term progress. short-term, we didn't raise taxes. we are dealing with h e overspending problem, clawing it back a little bit. long therm, we're never doing a 1982 or 1990 deal where we r rse taxes and cut spending, going to incest any time the debt ceiling
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goes up. dollar for dollar, spending comes down. those are long-term progress. there's a third part to the problem, we think. taxes, spending, there's a wave of regulations that have arrived or that have threatened. i think the biggest thing holding back economic growth is the concern next week you wake up, or e.p.a. or some other department decided not what kind of light bulbs you have, but how big the car can be. >> the amazing story that comes to mind the tax hikes after '92, '93, which is a terrible thing. by the year 2000, we had a decade of very good growth. all of the squandering took place after that. the things you said we will never again do. it will be things that put us briefly on the road to fiscal sanity. >> gentlemen, thank you very much indeed. coming up, the next big story. is the face of terror changing? should the massacre in norway be a wake-up call for law states?ment here in the united
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i'll ask new york city police commissioner ray kelly. somewhere in america, a city comes to life. it moves effortlessly, breathes easily. it flows with clean water. it makes its skyline greener and its population healthier. all to become the kind of city people want to live and work in. somewhere in america, we've already answered some of the nation's toughest questions. and the over sixty thousand people of siemens are ready to do it again. siemens. answers. but when she got asthma, all i could do was worry ! specialists, lots of doctors, lots of advice... and my hands were full. i couldn't sort through it all. with unitedhealthcare, it's different. we have access to great specialists, and our pediatrician gets all the information. everyone works as a team. and i only need to talk to one person about her care. we're more than 78,000 people
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looking out for 70 million americans. that's health in numbers. unitedhealthcare. two troubling case this week spotlight the threat posed the extremists in texas, the army captain planned another deadly attack on ft. hood and in norway. confessed mass murder has found unlikely defenders on the far right of the european political spectrum. at least three politics have come under fire for defending his extremisextremist, antimusl antiimmigrant views but violent extremism only a threat abroad? from some perspective we turn to a man on the front lines, new york city police commissioner, ray kelly.
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thank you for joining us. >> we heard all of the work, law enforcement is doing on islamic extremism home-grown terrorism threat. is there a possibility that a norway could happen here? >> it's something that we have to watch closely and we are. u.s. law enforcement is focused on the issue. i can tell new new york city, we have a task force in our intelligence division that looks at white supremacist/anti-government groups andindividuals. in fact, just a few days before the norway massacre, we had a teleconference with our century partners, this is 100 law enforcement agencies in the northeast quadrant of the country and that was the specific subject. we talked about certain groups and individuals we are concerned about. it's an issue that can pop up. quickly, without any advanced notice. because these individuals, play
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their cards very closely. they don't show their hand. just a few blocks from where you're sitting, we had a white supremacist walk into a holocaust museum in 2009 shoot and kill one of the security guards, he himself was shot but clearly he had mayhem in mind. enforcement has to focus on and i think we are. >> can you characterize some of the threats y y're hearing about, the nature of them? >> well, there are individuals who get together, and sort of follow a neo-nazi philosophy, and -- not unlike norway. but they are difficult to spot, and to a certain extent, they tend to get together in rural areas.
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they stay away from large cities. but in new york city, we have to worry about someone plotting an event away from the city, coming into new york. so, we're on the lookout for this sort of thing. but, it's difficult to identify. >> is it politically difficult as well? there's obviously an infamous case of a special report on this issue, written by an analalt, at the department of homeland security, and because of an outcry, once it was about to be released, it was quashed. is there a problem with trying to focus enough attention on this threat, given the sensitivity about the threat since 9/11, for instance, the islamic threat? >> you know, i guess there are always some first amendment issues that you have to be aware of, but i know -- we don't have a problem focusing on it, in new york city. we followed certain individual on the internet.
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they put out their feelings, quite clearly. a lot of them are careful about not advocating violence. for instance, the individual in norway, although we had a lot of internet activity, did not advocate violence. he put his manifesto on the internet six hours before the attacks. but so, they are -- they are somewhat careful about, you know, advocating violence. >> and just as we wrap up, i wanted to ask you, on this rapidly approaching tenth anniversary of 9/11, is new york, is america safer, or are there real issues thth you are still having to deal with? >> there's certainly real issues that we have to deal with. we think the elimination of osama bin laden was an important milestone but not a game changer. it was still very much at risk. we're concerned, as we get closer to the 9/11, memorial.
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because we know osama bin laden spoke about that date, twice in the last two-year period. so, the federal government, local and state authorities, are very much aware of the threat, and are on alert. >> commissioner kelly. thank you very much indeed for joining us from new york. >> thank you, christiane. >> and we want to bring you up to date on some other headlines from around the world. israel today is rocked by the largest protest in its history, more than 150,000 people are in the streets around the country, demonstrating against high housing and food costs and inadequate health care and education. police disbursed crowds in tel aviv but there are been no reports of violence, however in neighboring syria the news is very grim. the associated press, saying 62 are dead. they are stepping up a crackdown on antigovernment protest.
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this cops a day before the start of the muslim holy month of ramadan where nightly protests across the country are expected to grow larger. and in somalia, it is a race against time as u.n. release workers struggle to get help for the nation. a famine. perpetuated by terrorists who use food as a weapon. abc's david muir is the first american correspondent in somalia, traveling with the united nations and he filed this report from mow gadismogadishu. >> reporter: we through in this morning. it is the largest food emergency of the world. and when aid reached the city's capitol. there was something else, a gun battle. trying to protect the food, firing deadly shots of islamic
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militants, members of al shabab who have a crib on much of this country. this crisis is at a breaking point. tens of thousands are fled the country by foot. walking hundreds of miles, traveling what the u.n. calls the roads of death. we traveled the perilous route too. and then this mother, sitting beneath the tree. she was almost there. >> and how long was her juneny? >> ten days, she tells us. >> these are all her belongings from somalia? >> reporter: yes, she says. her own children have run ahead to the tents that now pepper the horizon. the first sign these refugees are nearing the camps. the children who race to keep us with us, their smiles have returned. a number of refugees swelling in the desert outskirt, so many now that the doctors have come to
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them. >> this is an ambulance? >> reporter: they take us inside their makeshift clinic. mothers putting their children in hanging buckets to weigh them. the hunger has now spread her be onthe most susceptible, beyond babe business and toddlers, the older children too. they say if they can get the knew tr nutrients, you soon see what we did. doctors allowed our camera into their intensive care unit at the refugee camp. we saw this little girl, tiny bones and sagging skin, the hospital director immediately told us, he saw something else. she was sitting up for the first time. >> this is the third day. and you can say that she's going to be okay? >> yes. >> reporter: christiane, it's something to see how quickly
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they bounce back after you feed them. it's imperative to get the food and aid here to the capital of mogadishu. there's are people coming by the tens of thousands, knowing the danger they face in doing so. a sign of how desperate they've become. you can travel on the convoy, you can see the torrential downpours will make the whole effort all the more challenging. christiane, back you to. >> david, thank you from mow mogadishu mow sallia. it is so hard. watch more on "world news." viewers have given generously to help the people of somalia. to see how you can help. visit our website a a abcnews.com/thisweek. we'll be right back. on a top secret project. it was a challenge that nobody had undertaken before. and we didn't know whether we could do it.
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and now, the "sunday funnies." >> we owe the money to china. the chinese are dropping hints they might want it back. they have. >> last night, i had chinese food and the fortune cookie said where's our money. >> i don't have your money. >> get my money. >> presidentntbama said compromise has become a dirty word. and then he told republicans to go compromise themselves. >> the debt ceiling debate drags on and on and both parties have been acting like children. the republicans saying give me give me, give me. democrats saying, take it, take it, take it, just don't hit me. >> and we'll be right back.
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♪ this is for all the lonely people ♪ i've been through the desert on a horse with no name ♪ ♪ it felt good to be out of the rain ♪ >> good evening from abc news headquarters in washington. i'm howard k. smith. >> i'm harry reisner in new york, these are tonight's headlines. >> and hideki irabu will pitch out of it. this week, the pentagon did not release any names of u.s. service members killed in iraq or afghanistan ands it ate first
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time since we began the segment that we did not have to mark the loss of any forces in the conflict. we'll be right back. anananannouncer ] this...is the network. a livingngbreathing intelligence that's helping drive the future of business. in here, inventory can be taught to learn. ♪ machines have a voice. ♪ medical history follows you. it's the at&t network -- a network of possibilities... committed to delivering the most advanced mobile broadband experience to help move business... forward.
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♪ that's our program for today. be sure to watch "world news tonight" for all of the latest on the debt ceiling negotiation, remember, follow us any time on twitter, facebook and ab abcnews.c abcnews.com. for all of us in washington, thank you for watching and we'll see you again next week.
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